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  3. 5. pillow company is purchasing an 80% interest in

5. Pillow Company is purchasing an 80% interest in the common stock of Sleep Com-...

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Accounting

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5. Pillow Company is purchasing an 80% interest in the common stock of Sleep Com- pany. Sleep's balance sheet amounts at book and fair values are as follows: Account Current Assets Fixed Assets Liabilities Book Value $ 200,000 350,000 (200,000) Fair Value $ 250,000 800,000 (200,000) Use valuation analysis schedules to determine what adjustments to recorded values of Sleep Company's accounts will be made in the consolidation process (including the creation of new accounts), if the price paid for the 80% is: a. $800,000. b. $600,000

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